A natural way to cope with fault tolerant control (FTC) problems is to modify the control parameters according to an online identification of the system parameters when a fault occurs. However. due to not only difficulties Inherent to the online multivariable identification in closed-loop systems, such as modeling errors, noise or the lack of excitation signals, but also long time requirement to identify the post-fault system and implemeutation of control problems during the identification process, we propose an alternative approach based on the observer-based fault detection and isolation (FDI) and model reference adaptive control (MRAC). The proposed robust fault diagnosis method is based on a bank of observers. We also propose a model reference adaptive control with changeable reference models according to the occurred faults. Simulation results of a flight control example show the validity and applicability of the proposed algorithms.